INTRODUCTION TO THE NEW PRODUCT DEVELOPMENT (NPD)

Audio: Introduction to the new product development (NPD)

New product development is the core of any successful company. In Overview of Mechanical design engineering, I generally wrote about mechanical design engineering, what it is, and what design problems you could encounter. However, in this article, we will discuss a specific design problem called original design. The original design is when we develop a process, assembly, or component that previously did not exist.

Each company that develops successful products has defined steps to develop new products. We will discuss why it is important to develop new products, what NPD is, and who develops the products. Furthermore, we will look into the generic NPD process and see the criteria for NPD success and the challenges during the process.

Introduction

People have been designing for thousands of years, and millions of products have been developed, and still, we are developing new products literally every day. Of course, civilization is moving forward, the population is growing, technologies are developing, new markets are opening, the trends are changing, pollution is increasing, we are depleting our natural resources, wars, etc.

On the one hand, with the current technological, business, and social changes, the rate of poverty is falling rapidly, and the quality and accessibility of healthcare are rising. Still, on the other hand, the pollution and depletion of resources are also increasing. Furthermore, the quality of life became questionable for many people even though they have “all the good stuff” of the modern world. The challenges we are facing now in the World are incredibly complex, and at this point, there is no going back.

While many of you would argue that the main reasons for developing the new product are profit and greed, and I would agree in some of the cases, I would also say that that is a bit limited and limited view of how the world works now. Whatever the reasons, there are many people in this World, and we all need a roof over our heads, and we all need to eat ( through the new product development, companies are earning money which they use to pay us to afford that).

Now, where the World is at, we do not have any other choice but to keep going forward. As I said, there is no going back. We have already built so much infrastructure; more than 7,8 billion people are living on the Earth, and the only thing we can do now is to keep moving forward.

We must develop new, better, more sustainable products with a high value and minimum environmental impact. It is imperative that we create better technologies to tackle the problems of high pollution, poverty, starvation, endangered wildlife, deteriorated mental health, etc. We must rethink how we approach these issues and develop more efficient processes.

We all can attribute to this through our daily work as mechanical design engineers. As small as the scale is, we can influence the design process and the products we are developing in our companies. We can improve the quality of the products, reduce the costs and expenditure of materials, use recyclable materials in our design, improve and optimize processes to reduce the spending of resources, etc. When enough of us make small-scale changes, the scale will tip at one moment, and the small changes become a significant change. It is our individual responsibility to improve the things that are inside our zone of influence.

What is new product development?

Before we start explaining the product development process, we need to understand what the product is. A product is “something” sold by companies to their customers. “Something” can be a physical or digital product or service. As mechanical design engineers, we are interested in physical products, and in the further text, I will address it only as “product. “

New product development (NPD) is a set of activities, from identifying customer problems or needs and developing solutions to production, sales, delivery, and retirement of the product. These activities vary from company to company, but they usually follow the same logic. But, before we talk about these activities, let us talk first about who is involved in product development.

Who develops products?

Products are rarely developed by a single person. Usually, product development involves a large team of specialists formed around different functions. The three main functions involved in the new product development are marketing, design, and manufacturing (core team). These three main functions are usually supported by an extended team that could include legal, business, finance, sales, etc.

Marketing is responsible for the communication with the customers. They conduct market research, identify new product opportunities, capture customer needs, etc. Furthermore, on the other end, marketing sets the target prices and oversees the product launch and promotion of the product.

Design is responsible for developing the product to best meet customer needs. The main responsibilities are industrial design (aesthetics, ergonomics, user interface, etc.) and engineering design (mechanical, electrical, etc.)

Manufacturing is responsible for coordinating production systems with the goal of producing the product. The manufacturing function includes material purchasing, production, distribution, and installation.

Product development process

Throughout the years, different product development processes have been developed to cover different industry needs. There are many different approaches to product development like the Stage-Gate process, Integrated Product development, Lean and Agile product innovation, etc. It is important to understand that none of these processes will fit each company. While the company could use the framework from one of these processes, the product development process still needs to be suited to the specific industry, company, and customer needs.

Let us look now into the generic product development process. It contains seven phases:

Product discovery
Project planning
Product definition
Conceptual design
Detail design
Testing and refinement
Production (Ramp-up)

Of course, depending on the company, more phases can be added (or some of them can be subtracted).

Considering this is a complex and lengthy topic, I wrote another article covering only this chapter: New product development (NPD) process.

We can think about the product development process as a subtraction process; we start with the wide set of alternatives that we are eliminating during the product development process until we are left with only one and the best option.

How do we know if the product is successful?

Once we developed the product and introduced it to the market, how do we know if it is successful? Well, there are a few different metrics that can be used to assess the product development effort:

Profitability. While this can be often difficult to assess quickly and directly, some companies are only looking that the product can be produced and sold profitably.
Product quality. The quality of the product reflects on the price that customers are willing to pay. Did a product satisfy all the customer needs? Is it robust, and do you have all the industry certificates to prove it?
Product cost. How much does it cost to produce the part? What was the capital investment on the equipment and tools? How much does it cost to distribute and/or install the product? A detailed cost analysis can determine the profit per product sales and give a product profit forecast based on the sales volume.
Development time, cost, and capability. How quickly did the team develop the product? What is the cost of product development efforts? Does the team have the ability to develop future products more efficiently and economically?

Depending on the company (or department), there could be different success criteria. The success criteria are usually defined based on the goals and strategy of the company or department, and it is used as a measure to see if the direction they are headed is the right one.

Product development challenges

New product development is not all sunshine and rainbows. Developing new products from idea to final product is a hard, time-consuming, and expensive process. Here are some of the biggest challenges in the new product development process:

Trade-offs are a normal part of new product development. There will always be some customer requirements that we will have to sacrifice to achieve another. From the design perspective, for example, you can have a trade-off between the cost and weight of the product.
The technology is improving rapidly, new products arrive on the market, the geopolitical situation in the World is changing, etc. Operating in a constantly changing environment is extremely difficult. From the design standpoint, for example, the competitor introduced a new product similar to the one you planned to introduce to the market. Based on the project’s status, you could redesign the product, kill it, or continue it as it is.
Details. You probably heard saying: “The devil is in the details.” Each part of the product must be detailly analyzed because even the smallest part or feature of your part can have high economic implications. Furthermore, each part can contribute not only to the final cost of the product but also the quality. From the design perspective, this could be choosing the standardized part or designing a new one.
Time pressure. In the ideal world, you would have all the time you need to develop the product. Unfortunately, that is not the case in reality. Time is money, and the ability to deliver a new product to the market quickly could mean the success or failure of the product. The market is changing all the time, and being able to deliver the new solution in a timely manner is desirable. The more complex the product is and the more individual components you have, the more work you will have to do.

Economics. A lot of resources are required to develop a new product, from capital investments to human resources. The bigger the project is, usually, the higher investments are needed. From the design perspective, this would include salaries, equipment, software, prototypes, tools, etc. On the other hand, connected to the economics of the product, it is always a challenge to produce a high-quality product that is relatively inexpensive to make. If your customer can buy the same product with the same level of quality for less money, they for sure will. You would do the same. From that point, as a mechanical design engineer, you can influence the product cost in every step of your design process. You can choose whether or not to use standardized parts; you can select the type of material that is more or less expensive. You can define tight tolerances where they are not needed and raise the individual components’ price. If you design mostly for manual assembly, the price will increase, etc. There are many ways for a mechanical design engineer to influence the final product price.
Team diversity. If you work in a multicultural company that has team members all around the World, there are always challenges in communication regarding the difference in time zones. Furthermore, as individuals, we are all on different levels of expertise and have different personalities. Therefore, finding an efficient way to work together and communicate is not always easy.
Team spirit. Usually, product development teams are highly motivated, but when the project lasts for a long time, with many daily challenges, sometimes it is hard to keep the team spirits up. To keep up the team spirit, the company must have a great leadership team that will lead the team with a clear vision of what is ahead.

Closing words

Developing new products and technologies is crucial for civilization to move forward. Companies use different new product development (NPD) processes depending on the industry and customer’s needs. The new product development requires a lot of investments; it is a hard and complex process that involves different functional teams with experts in various fields.

The core team of every new product development consists of marketing, design, and manufacturing, while other functions support them during the NPD process. To develop a successful new product, there are different challenges, and it is a constant struggle to overcome.

Now you have an excellent overview of new product development. However, I suggest you go through the text once more and identify areas you think need more understanding and clarity. Then, once you have identified those areas, start building up your knowledge in those areas.

To make it easier for you to find related posts, check the “Further reading” chapter below. Do you have any questions or need something to be clarified better? Leave a comment below, and I will give my best to adjust the post accordingly.

Do you like what you read? Then, share it with your friends, colleagues, and on your social media channels. And if you want to become a part of the Newtonians, make sure to subscribe to our newsletter!